The Wall Street Journal-20080126-Caterpillar- Honeywell- Amgen Gain- Microsoft Shares Slip Despite Solid Profits- Goldman- Citigroup Fall
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As stocks completed a dizzying week, concerns about bank losses and diminished hopes of further rate cuts outweighed optimism about overseas growth for multinationals like Microsoft, Honeywell International and Caterpillar.
"This week felt like a long year," said Anthony Conroy, head trader at BNY ConvergEx Group.
Microsoft (Nasdaq) shed 31 cents, or 0.9%, to $32.94, even after stellar earnings for the software giant and an executive comment that "geographical spread" would help the company "weather a downturn in the U.S. economy."
Caterpillar added 68 cents, or 1%, to 65.93. The maker of construction equipment forecast strength in overseas markets to facilitate its growth in 2008 despite recessionary conditions in the U.S.
Global industrial conglomerate Honeywell rose 2.05, or 3.7%, to 58.25 after it logged robust fourth-quarter profit growth, and said it saw no signs of slowing demand.
After appearing on leaders lists all week, financials fell out of favor again Friday.
Goldman Sachs Group fell 7.48, or 3.8%, to 191.37 after the Wall Street bank said it plans to lay off about 5% of its employees as a routine part of its annual review process. While the bank said it continues to hire aggressively, the report initially spooked the market.
"If the ones who had it right in this environment where everyone had it wrong are cutting back, I think that tempered the market's enthusiasm," said Pete McCorry, senior equity trader at Keefe, Bruyette & Woods.
Citigroup fell 69 cents, or 2.5%, to 26.64 but finished the week higher by 9%, helped by the Federal Reserve's drastic interest-rate cut.
Health-care stocks, often a reliable standby in times of uncertainty, were mixed Friday.
Merck fell 1.77, or 3.6%, to 47.79 after the Food and Drug Administration said it will issue an unspecified "early communication" about cholesterol-fighting drug Vytorin. Investors anticipated some reaction to recent study data suggesting patients taking Vytorin fared no better than those on a generic drug.
Shares of Merck's partner on Vytorin, Schering-Plough, fell 1.15, or 5.7%, to 19.02.
Wyeth fell 1.98, or 4.6%, to 40.86 after the drug maker said it may cut about 10% of its employees over the next three years, as it vies with generic competition for many of its top drugs.
Amgen rose 2.02, or 4.4%, to 48.14 on the Nasdaq after the biotechnology concern posted flat fourth-quarter earnings on strong sales of its anemia drugs.
American depositary shares of South African gold miners AngloGold Ashanti, which fell 2.16, or 4.8%, to 43.01; Harmony Gold Mining, down 87 cents, or 7.4%, to 10.87; and Gold Fields, off 1.55, or 9.3%, to 15.15, were all hurt by power shortages and rolling blackouts in South Africa, which brought mining to a standstill.
MGM Mirage shed 2.25, or 3.1%, to 70.80. The Associated Press said a fire broke out on the roof of the Monte Carlo hotel-casino on the Las Vegas strip and spread, forcing an evacuation.
